Growth & Justice Blogtag:typepad.com,2003:weblog-13826382013-03-04T07:00:09-06:00TypePadA different tone in this year's tax committee hearings, and a clear consensus for more and fairer revenuetag:typepad.com,2003:post-6a00e3982414c88833017ee8e5e1cc970d2013-03-04T07:00:09-06:002013-03-04T07:00:09-06:00I've heard infinite versions of "don't tax me'' or "taxing me or my customers more will destroy my business AND the economy'' in my decades under the dome. And last week's opposition at a House hearing to ending sales tax...Dane Smith

I've heard infinite versions of "don't tax me'' or "taxing me or my customers more will destroy my business AND the economy'' in my decades under the dome. And last week's opposition at a House hearing to ending sales tax exemptions on business services was typical in many respects. Just because these fears often turn out unfounded _ our economy was performing better, in the 1990s, when taxes were higher _ doesn't mean these specific concerns shouldn't be heeded.

But I don't recall ever hearing as many tax opponents acknowledge, as they made their sincere case against losing tax exemptions on their own business, that our communities do need more revenue for public investment and for dealing with demographic challenges. Time after time I heard these business owners or their association leaders, who are also citizens, say that they supported or understood the need for more revenue, just "please, not on me or my customers, this time.'' And when all the opponents got through testifying, alternating one-for-one with those who favored the governor's plan, there were still more testifiers left who favored the reasonable increases in Dayton's plan, and the badly needed investments on the budget side, from early childhood education to transportation to workforce training. I didn't hear nearly as many angry diatribes against government and taxes in general as I've heard in previous years.

That consensus for more revenue comes through in the Star Tribune's Sunday poll, showing once again that a majority favor restoring higher income tax rates on the highest income margins, while opinion is evely divided on expanding the sales tax base to more consumer services. A clear majority opposes ending the exemptions for so-called "business-to-business'' services.

This consensus for "reasonably more'' actually is not new. Polls show support for revenue sufficiency was strong all through the 12 years of rule by one governor whose slogan was "give it all back'' and another whose central theme was "no new taxes,'' and legislative majorities that took the same hard and uncompromising line in 2011-2012. Especially after budget crises began recurring regularly in 2001 and beyond, polls consistently showed that most Minnesotans thought revenue increases ought to be at least part of the solution for budget shortfalls. That happened also to be the position of almost all former governors in all three parties through that period. And in almost every reputable poll I've seen, most Minnesotans think those who have been reaping almost all the benefits of increased productivity in recent years, and who have been paying a smaller percentage of their big increases in state-local taxes, ought to contribute reasonably more.

Dane Smith

A week for reflection and commitment to justice and broader prosperity (and yes, taxes and public investments help do that)tag:typepad.com,2003:post-6a00e3982414c88833017d403d19bd970c2013-01-21T06:49:22-06:002013-01-21T07:03:57-06:00We have this week a confluence of events that ought to lift our hopes and sharpen our resolve to reduce racial and economic inequality in our state and nation, and to build a more inclusive prosperity. The hope comes from...Dane Smith

We have this week a confluence of events that ought to lift our hopes and sharpen our resolve to reduce racial and economic inequality in our state and nation, and to build a more inclusive prosperity.

The hope comes from the momentous coincidence today of Martin Luther King's official birthday observance and a re-inauguration, after a convincing re-election, of the first African-American president of the United States. Michelle Obama, a descendant of slaves, is the First Lady of a White House that once was occupied by white slave-holders, and actually built by slaves. This is a remarkable country, capable of extraordinary self-correction, powerful and wealthy because it is governed by its own people, and stronger yet when ALL its people are empowered. We can expect President Obama will build on the theme in his inauguration speech that we all do better when we ALL do better. While the Obamas have succeeded spectacularly, far too many people of color are still left behind, and economic disparities continue to grow between top incomes and families of all races in the middle-income brackets.

In Minnesota, attention swivels on Tuesday to the release of both a two-year state budget proposal and a major tax system overhual from Gov. Mark Dayton. Minnesota's prosperity rests on an innovative business leadership, to be sure, but also on a foundation of public investment, in the form of high-quality public education, physical public works infrastructure, public health and natural resource protection. We need to invest more and more effectively in those things, including early childhood education and post-secondary training, and Gov. Dayton can be expected to emphasize that this broader prosperity and better government is the end we seek, while taxes merely are one of the means. Minnesotans understand these fundamentals and have long been distinguished by a commitment to public good, as well as private gain. Let's try to keep this in our heads as we all get ready to argue over the details.

Dane Smith

How we can help the poor help themselves, and our economy, Selvaggio-styletag:typepad.com,2003:post-6a00e3982414c88833017ee599a291970d2012-11-26T06:27:46-06:002012-11-26T06:27:46-06:00Joe Selvaggio is a celebrated former priest who has spent nearly half a century helping poor folks become more productive and less poor, lately through the MicroGrants program and before that, Project for Pride in Living. He also recently authored...Dane Smith

Selvaggio is the soul of charity but he's not a naive do-gooder who sees poor folks as purely victims. And he argues that they ultimately are responsible for grabbing on and pulling up on the hands that are offered from public and non-profit workforce training providers. And he also concludes that governments need to invest more in broad-based self-sufficiency and productivity efforts instead of just focusing on direct aid and entitlements. Citing the success of the Harlem Children's Zone and other non-profits such as Twin Cities Rise! and Summit Academy OIC, Selvaggio notes:

"Entitlements seem to be anathema to the right, left and center. But job-training programs are politically acceptable to left, right and center. The private nonprofit sector has proven that they work, but philanthropy can't do it alone. Now it's time for government to put muscle behind them...Change the paradigm and think of the poor as locked in a cocoon, ready to develop into a productive creator of wealth.''

Our policy-makers in Minnesota need to find what's working best in in preparing and moving chronically unemployed or under-employed folks in to the decent jobs that are being created in our new economy and right in their communities, whether it's health-care, transportation, financial industries, or construction. Growth & Justice is beginning a project that will illuminate those models. And our legislators and other elected officials must be ready and willing to invest in them. Because this really is an investment that pays off for everybody.

Dane Smith

Itasca Project elevates higher ed as key to growthtag:typepad.com,2003:post-6a00e3982414c888330177433d7dd4970d2012-07-11T06:24:31-05:002012-07-16T13:09:18-05:00Every serious student of public policy In Minnesota needs to see at least the executive summary of an important new study out this week by the highly respected Itasca Project. The IP is a group of corporate and community leaders...Dane Smith

Every serious student of public policy In Minnesota needs to see at least the executive summary of an important new study out this week by the highly respected Itasca Project. The IP is a group of corporate and community leaders that has led the way in the past with consensus-seeking studies on transportation investment, early childhood education needs, and the education achievement gap. The Itasca Project's latest report elevates higher education improvement and attainment as the key to sustained economic growth in Minnesota. Among the findings and recommendations in Higher Education Partnerships for Prosperity:

Future growth will require "deeper and more relevant skills from the workforce and increased innovation from researchers, entrepreneurs and businesses." By 2018, 70 percent of Minnesota jobs will require postsecondary education.

Pressure on state budgets during the decade from 2000 to 2010 drove a 35% reduction in public funding per student in Minnesota, which drove up tuition and raised barriers to completion. (My editorial comment: these cuts were driven by an anti-government, anti-tax pledge that was unconscionable, and cutting higher education was dumber than eating seed corn).

At Growth & Justice, we've been urging for several years now that policymakers set a clear goal for the state for postsecondary completion of 75 percent for all young adults by 2020. Put another way, the best route to sustained prosperity in Minnesota is to ensure that at least three out of four young adults have some sort of post high-school certificate or credential that enables them to enjoy a more productive career and realize their fuller human potential. And this imperative is particularly important for our kids of color, who currently are lagging far behind in academic achievement and attainment. Developing their potential is our best opportunity for business growth and productivity.

--Dane Smith

Moving from Inequality to Equity in our Regiontag:typepad.com,2003:post-6a00e3982414c88833017742b42cec970d2012-06-25T12:04:52-05:002012-06-26T13:16:29-05:00Among other Met Council members at a roundtable discussion last week at the Rondo Community Outreach Library in St. Paul, Roxanne Smith representing Champlin said the “superior growth model” and the “top priority” for the Met Council is to close...Dane Smith

Among other Met Council members at a roundtable discussion last week at the Rondo Community Outreach Library in St. Paul, Roxanne Smith representing Champlin said the “superior growth model” and the “top priority” for the Met Council is to close the unemployment gap between African Americans and whites, currently one of the worst in the nation. This was reaffirmed earlier this year when the Met Council’s Corridors of Opportunity and HIRE Minnesota pushed MNDOT to raise their workforce inclusion goal for people of color to 32 percent up from the previous goal of 11 percent.

The devastating consequences of the double-dip recession and the foreclosure crisis have disproportionately impacted the core cities and older suburbs throughout the Twin Cities region. The inclusion of these disenfranchised communities in the planning of economic, transit and housing development will ultimately be, as Russ Adams, director of the Alliance for Metropolitan Stability described, a “down-payment” on the “untapped human potential” to secure a vibrant, competitive and prosperous economy.

We couldn’t agree more. Growth & Justice has consistently advocated for smart investments in Minnesota to create sustainable public infrastructure and a prosperous economy. Our emphasis is on equity.

To hear more about economic disparities and recommendations for equitable solutions, please join us on Tuesday night with author Chuck Collins and Headwaters Foundation for Justice, On the Commons and Wealth for the Common Good as we address many of the central questions of our time: Who are the 99 percent? How extensive and systemic is inequality in different areas of society? How is inequality changing in our world? Do we dare be hopeful about changing it?

Can Minnesota learn from North Dakota's business model? Sure, if we strike oil.tag:typepad.com,2003:post-6a00e3982414c888330163068b4fbb970d2012-06-13T21:55:42-05:002012-06-14T09:48:55-05:00As someone who grew up in oil sale country and spent two summers working oil rigs during college, I often cast a jaundiced eye over claims that combine "economic growth," "business-friendly regulatory and tax climate" and "oil and gas industry."...charlieq

As someone who grew up in oil sale country and spent two summers working oil rigs during college, I often cast a jaundiced eye over claims that combine "economic growth," "business-friendly regulatory and tax climate" and "oil and gas industry."

Chances are, the writer is about to praise a government that is only starting to enjoy its first oil and gas boom before all the social costs have come due. High paying jobs and environmental problems tend to get noticed first, but there are also housing shortages, crime, new demands of roads, schools and other public systems that cost money (which oil companies cover somewhat) and aggravation, which is almost completely paid for by the residents.

Earlier this month, I ran across a breezy opinion piece in the Duluth News Tribune titled, "A view from North Dakota: Minnesota can learn from North Dakota’s business model," that set off my radar. It began:

My move (from Duluth) to North Dakota and position at the state’s chamber of commerce has allowed me to better understand how and why North Dakota is capturing the nation’s attention with record economic growth and low unemployment rates.

There's nothing like a regular paycheck to allow you to better understand your employer's point of view. But when you promote it in the newspaper, it's a good idea not to get too far outside the facts.

The op/ed has since slipped behind the newspaper's paywall, but it was posted as a comment at Minnesota Brown if you want to read the entire piece. I thought it worth questioning, and wrote the following response, which the newspaper published:

How nice that the CEO of the North Dakota Chamber of Commerce wrote a column for his hometown paper to cheer on Minnesota businesses to imitate North Dakota — or else to simply move there.

Before anyone pulls up stakes for the greener grass across the Red River, let’s look closely at Andy Peterson’s business-climate claims.

He declared the impact of the oil and gas boom is overblown. Why, “only 25 percent of the state’s tax revenue” comes from that industry. Compare that to Minnesota, where mining produced 0.5 percent of the state’s tax revenue in 2011, and where taxes from all corporations kicked in 4 percent.

Peterson wrote, “Of the more than 24,000 jobs available in North Dakota, nearly 66 percent are outside of the oil-producing counties.” Of course they are. The top five counties had barely 20,000 people before the boom began. And consider all the other sectors that depend on oil and gas expansion: trucking, construction, hospitality and even education and health services. How many of those support jobs could find a foothold in the small towns near the oil patch?

Then there was the claim that “North Dakota is a national leader in manufacturing growth.” According to the Bureau of Labor Statistics, the state had a 12-month, 4.6 percent manufacturing growth rate as of April, definitely beating Minnesota’s 1.7 percent rate, but that’s off a small base. Minnesota has 305,500 manufacturing jobs while our neighbor to the northwest just crept over 24,000 in December — up a total of 1,000 jobs compared to 10 years ago.

Take away oil and gas, which has been growing at a 44 percent rate, plus all the employment serving that industry, and the North Dakota miracle looks like nothing to write home about.

The author also made it sound like North Dakota's friendly business and tax climate had induced Minnesota's Marvin Windows and Doors to open three plants North Dakota. While it's true Marvin has expanded in the state, the company itself hasn't made the claim that tax and regulatory concerns drove it there. Back in 2008, when Marvin announced a plant expansion in Grafton, ND, I suggested some other reasons it made sense for the company.

We wish North Dakota good luck with its oil boom. Severance taxes are a great way to export a state's tax burden. But when those state boosters make distorted economic comparisons with Minnesota (even if they're disguised as Minnesota Nice helpful advice), we'll be there to set the facts straight.

—Charlie Quimby

Top priority for transitway development should be employers and jobstag:typepad.com,2003:post-6a00e3982414c88833016766c5f9db970b2012-05-25T07:21:47-05:002012-06-05T16:48:47-05:00You are a policymaker and you have a tough choice between two big development proposals for the same site on a key light rail line or transitway. All other things being equal, which do you choose: a major employer or...Dane Smith

You are a policymaker and you have a tough choice between two big development proposals for the same site on a key light rail line or transitway. All other things being equal, which do you choose: a major employer or a large housing complex?

Minneapolis Promise makes progress in getting kids on early college tracktag:typepad.com,2003:post-6a00e3982414c88833015392c762bd970b2011-11-04T07:27:35-05:002011-11-09T12:40:43-06:00Research shows that getting kids and their parents in a post-secondary mindset as early as possible -- creating not just hope but an expectation for college attainment -- makes a big difference in whether they get credentials. Minneapolis Mayor R.T....Dane Smith

Research shows that getting kids and their parents in a post-secondary mindset as early as possible -- creating not just hope but an expectation for college attainment -- makes a big difference in whether they get credentials.

Minneapolis Mayor R.T. Rybak and his top economic development official, Mike Christenson, without a lot of fanfare, have been working this angle for years. Every year in the fall Mayor Rybak addresses every 9th grader in the city with a message and specific programmatic inducements that encourage them to compete for summer jobs and scholarships for college, or that put them on the post-secondary track.

Christenson, director of the Minneapolis Department of Community Planning & Economic Development, and a Growth & Justice Policy Fellow, summarizes the success of those efforts in a recent MinnPost Community Voice column, key parts of which we reprint here:

"Let's begin with the story of Alex Glaze. Alex and his twin sister grew up in poverty and were removed from their mother's home early in life. Alex quickly learned that if he needed a ride to school or school supplies, he was on his own. He began working in junior high to take care of household needs. At 18, Alex and his sister were told to leave their father's home for good.

After graduating from Southwest High School, Alex worked in the Minneapolis mayor's office as a STEP-UP intern. This summer, he joined nearly 2,000 other STEP-UP interns and dozens of employers to celebrate their summer accomplishments. For many interns, it was their first work experience. Like so many of us, they described their summer jobs as their first big break...

....The summer job is one of three parts of the Minneapolis Promise offered through Achieve Minneapolis. Mayor Rybak visits assemblies of ninth-graders in each Minneapolis public high school every fall. There, he lays out a compelling alternative to street life. Every Minneapolis youth may compete for one of 2,000 summer jobs, must complete a college and career map called "My Life Plan," and can apply for thousands of scholarships through Minneapolis Community & Technical College, Augsburg College, the University of Minnesota, Admission Possible, the Children's Defense Fund, the McGuire and Wallin and Page Foundations and many more programs.

State and city leaders from all sectors worry about the overwhelming challenges of the achievement gap in Minnesota. Populations of color trail others in measures of educational success at a nation-leading rate. We're a proud state, and national leader in so many categories, but this is a leadership position we need to vacate. After eight years, the Minneapolis Promise offers hope. A combination of summer jobs, career and college plans, and scholarships adds up to more than the sum of its parts...[and]...if the Minneapolis Promise continues to grow, the achievement gap will shrink. Here are the facts:

• Over 82 percent of the STEP-UP and city summer interns are persons of color.• More than 900 students have attended MCTC under the Power of You program, and the number of Minneapolis high-school graduates has more than doubled at MCTC in five years.• The University of Minnesota has admitted 166 STEP-UP interns since 2006. • ACT testing and college participation rates from the Minneapolis high schools continue to grow.

...Minnesota's future work-force challenge will be to inspire populations not likely to attend college to hear this promise. In Minneapolis, we have found that summer jobs join with college supports to boost college participation. Let's hope that miracle can go to work, first through a summer job, for all Minnesota youth like Alex. And let's hope that the business community, which has kept this promise in Minneapolis, will inspire others as well. One last thing: Alex Glaze is in the freshman class at Stanford this fall." (Bold italics added).

"More Bang for Your Buck" should be required reading for Minnesota policy typestag:typepad.com,2003:post-6a00e3982414c88833015435ef9dce970c2011-10-09T19:52:46-05:002011-10-10T14:51:15-05:00Peter Heegaard is a former executive for a financial firm, and he's well-known in Minnesota public policy circles as a leader with a strong social conscience, a great combination of heart and passion for progressive change and hard-headed analytical sense...Dane Smith

Peter Heegaard is a former executive for a financial firm, and he's well-known in Minnesota public policy circles as a leader with a strong social conscience, a great combination of heart and passion for progressive change and hard-headed analytical sense on dollars and cents. His new book, "More Bang for Your Buck,'' should be required reading for policy wonks in Minnesota who want to be on the cutting edge of what works in human services, and more important, how to tell. Two subtitles on the cover summarize the contents: "Good News for Taxpayers, Public Officials, Philanthropists & Non-profit Managers,'' and "How Cost/Benefit Analysis Can More Effectively Promote the Public Good."

The book brings state-of-the-art thinking and many actual case-by-case calculations to the emerging efforts to show the return from public and nonprofit invesments in human capital, primarily education, workforce preparation and other human services. Heegaard's book explains with lively detail how leading Minnesota nonprofit groups, such as Admission Possible and Twin Cities Rise, and others, many of which benefit from taxpayer support, have been able to document with cost-benefit analysis that their work with human capital is in fact returning an investment to the economy and to society.

I like this passage in the introduction: "Enough examples of high payoff civic investments now exist to make a very strong case that the art of giving or philanthropic investing, including government budget decision-making, can create new solutions to age-old problems, while at the same time improving the returns on our taxable income.'' The book is available at Nodin Press.

--Dane Smith

Growing together: using equity to spur growthtag:typepad.com,2003:post-6a00e3982414c88833015433675046970c2011-07-02T07:55:00-05:002011-07-11T11:43:35-05:00Speakers at an event last week made a powerful and compelling case for equity as a growth strategy. Minnesota stands out for some striking inequities tied to race – embarrassing disparities when it comes to educational attainment, unemployment rates, income...Matt Kane

Speakers at an event last week made a powerful and compelling case for equity as a growth strategy.

Minnesota stands out for some striking inequities tied to race – embarrassing disparities when it comes to educational attainment, unemployment rates, income levels, poverty and other important measures of both individual well-being and the economy.

A problem? Yes. A challenge? Yes. An opportunity? Absolutely!

Speaking at an Anchoring Equity presentation, coordinated by the Metropolitan Council, the Northwest Area Foundation and others, john a. powell noted that Minnesota tapped the potential of women in the state decades ago by advancing opportunities at a time when women faced barriers and many argued, for example, that education was wasted on women.

As a result of increased equity for women, a whole new segment of the population put its talents to work and helped move forward the Minnesota economy and the prosperity of the state’s families and households. The United States did likewise, well ahead of most countries worldwide.

The issue, said Ohio State University’s powell, is not redistribution but growth.

Angela Glover Blackwell from PolicyLink, another speaker at the event, defined the term. Equity is “just and fair inclusion into a society where all can reach their full potential.”

Glover Blackwell pointed out the moral imperative for addressing inequities. But she, too, emphasized the potential for economic growth that results from doing just that. “Equity is the superior growth model,” she said.

Growth & Justice makes the same argument in its recent report and policy brief, We’re All in This Together: Educational Achievement and Attainment by Minnesotans of Color.

As the report notes, “With Minnesota’s population becoming increasingly diverse, we as a state have the chance to address and overcome these educational inequities, tap the talent and potential of all Minnesotans, and secure the Minnesota advantage well into the future.”

We’re certainly not there yet. Nekima Levy-Pounds from the University of St. Thomas’ Law School cataloged many of the disturbing inequities in Minnesota, focusing on differences in situations and outcomes for black and white Minnesotans.

Minnesotans must awaken to the sense of urgency, build the political will to change the situation, and ensure that Minnesotans of color are at the table leading these efforts from the start, she said.

Speaking after Levy-Pounds outlined the disparities, Glover Blackwell gently asked if the audience was embarrassed by the inequities in the state and, for that matter, in the nation.

“These disparities are horrible. They are troubling. And something needs to be done about them,” she concluded.